Hello, I've had a look at the pattern and I think I've found the source of the confusion.

They carefully told us how to knit the lining and how to knit the stripes (by using the Intarsia Method and following the chart), but forgot to tell us that the outer is knitted the same way as the lining (while factoring in the stripes).

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An English Knitter (nationality and method).
Feel free to call me either Clutter or Julie (my real name).

A sweater of a thousand yards begins with a single stitch. Lao-tzu's Granny

The Following User Says Thank You to Dclutterchique For This Useful Post:

Do the cast on and include the earflaps as you go around:
Cast on the initial sts for the size your making, knit across the held sts for one of the earflaps, cast on the next set of sts, knit across the held sts for the second earflap and then cast on the final set of sts. All this is done with the single strand of your working yarn. The main body of the hat will then be knit up with the earflaps in place.
Yes, the description of this for the outer hat is omitted. You should do earflaps and attach the same way but with the outer color.